So far, most of the news about the head of Xbox, Asha Sharma, has been viewed positively by Xbox fans, but unfortunately, it seems a real wake-up call is about to hit. As is well known, the Xbox division has been struggling with major problems for years, and now Bloomberg reporter Jason Schreier is reporting that it's time for some sort of reset.
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This includes major layoffs reportedly set to begin as early as July, as well as cuts to marketing budgets and possibly some studio closures. In an internal memo on the matter (via Xbox Wire) from the second-highest-ranking Xbox executive, Matt Booty, the issues are explained in an unusually candid manner:
"Excluding Activision Blizzard King, over the past five years, we have spent over $20 billion on ongoing investments in our content, platform, and hardware subsidy, but our annual revenue has declined nearly half a billion during that time. Going forward, this cannot continue."
On top of that, we have skyrocketing hardware prices, which pose a major dilemma for the upcoming Project Helix console. Booty notes that components today cost "over five times what we paid just two years ago. Memory costs have followed a broadly similar trajectory", and concludes that "we need a new business model and partnerships for hardware as we remain committed to Helix."
Layoffs are always deeply unfortunate, especially for the individual, but there is no doubt that the Xbox division has been struggling and needs to be overhauled when you look at Booty's statements above. We're keeping our fingers crossed that as few people as possible are impacted and that Microsoft supports those affected as much as possible, and that Xbox emerges stronger on the other side.